U.S. Markets close in 19 mins

Postal Service: Closings Amid the Cash Crunch

The Exchange
Mail trucks in front of Cooper Station post office in East Village, New York City. (photo: Siemond Chan)

The U.S. Postal Service failed to deliver a $5.5 billion payment due August 1 to the U.S. Treasury for future retiree health-care payments, and said it will also not be delivering a $5.6 billion payment that's due September 30 absent any action from lawmakers.

The USPS struggles are no sudden surprise -- it's been losing money since 2007 (see the chart below) and lost $14.1 billion in 2011.

The USPS announced a plan earlier in the year that included cutting Saturday service, reducing hours of operation at some remote offices, and closing some money-losing locations, in addition to eliminating as many as 220,000 jobs. (See below for states that had the greatest number of post offices considered for reduced hours of operations.)

The U.S. Senate passed a bill that would allow the post office to cut staff by 100,000, but lawmakers would not clear the path for other requests, including the closure of offices that are a financial drain and the cutback to five-day delivery.

Yahoo! Finance asked readers last week if the USPS should nix Saturday delivery, and the majority said yes. Readers responded 85% to 15% that the USPS should cut to five days.

"The Postal Service continues to implement its strategic plan. However, comprehensive postal legislation is needed to return the Postal Service to long-term financial stability," according to the statement made last week. "We remain hopeful that such legislation can be enacted during the current Congress."

Williamsburg Station post office in Brooklyn, New York City. (photo: Siemond Chan)

In the meantime, the USPS said it will continue to "deliver the mail, pay our employees and suppliers and meet our other financial obligations."

Mail trucks in the parking lot Williamsburg Station post office in Brooklyn, New York City. (photo: Siemond Chan)